Innovation is critical for region, says Oil Minister

The use of plastics has grown exponentially in tandem with global economic growth, innovation in materials science and the continued use of the commodity in consumer goods, Bahrain’s Minister of Oil said on Tuesday in his keynote address at the 13th Annual GPCA Forum.

“Innovation is really critical for that trend to grow,” said H.E. Shaikh Mohammed bin Khalifa bin Ahmed Al Khalifa, adding that demand for plastics is witnessing a slowdown as a result of tepid economic growth.

Trade wars, currency challenges and the commoditization of products that the GCC has been producing are some of the hurdles that the industry faces, the minister added.

“GCC is now a truly important partner in the world and plastics in particular. The advantage of feedstock has brought us on to the world map. Will that continue – so far the challenges are clear – we are looking at going towards liquid cracking versus traditional ethane cracking,” he said.

“Geographically we are not advantaged, as we don’t have large domestic markets, and hence we have to export,” Shaikh Mohammed said.

For the future, as the scarcity in gas feedstock becomes apparent the GCC chemicals industry is looking towards refinery integration, with mixed-feed cracking.

“Does that integration give you enough economic advantage, it is a debate, but certainly not comparable to the very large advantage that cheap ethane gives you,” Shaikh Mohammed said.

“Integration does help to save costs, it does help with waste streams from the refinery and the petrochemical plants… so maybe not exactly the same value that low-cost ethane feedstock will deliver but nevertheless it does provide multiple advantages,” he said.

Shaikh Mohammed concluded by saying that, “Strong and visionary CEO leadership is essential for implementing the circular economy and for reaching new levels of sustainable economic growth.

“By applying these principles, companies can design out waste, increase resource productivity and decouple growth from natural resource consumption.

The circular economy will provide innovation opportunities for us in the Gulf also.”